The Agora Dispatch — Weekly Newsletter — 18 January 2023

Welcome to the Agora Dispatch — news and views from around the econOHMy

Summary:

Editorial —A finely balanced asset

Marco round-up

Around the econOHMy

Market forces — New target price moves lower cushion

Tap-16 — Opyn Crab, getting snipped

OIP-127 OHM Lending Markets Pilot Program — Passes

Editorial —A finely balanced asset

We think OHM is a finely balanced asset. It has a lot going for it.

Picture an asset with the following exposure:

All that — & it is still mostly stablecoins and trading $2 below backing at $9.83.

Holding all that tasty selected exposure has led to an increase in the target rate — discussed more below.

What an asset!

Macro round-up

On the macro front — we saw PBOC & BOJ adding more liquidity which was helped by the weakness in the dollar. This seems to have helped stabilize markets at the current levels — including crypto.

https://twitter.com/crossbordercap/status/1614966129507672065https://twitter.com/crossbordercap/status/1614966129507672065

The US will hit the debt ceiling by this Thursday which is much sooner than most expected — and setting the stage for a dogged fight with the new Republican Congress. Zerohedge argues this may well mean the end of QT for the time being & a return to QE by Summer (sorry it’s paywalled).

Davos kicked off with the creepy theme Master the Future — expect it to be full of praise for emerging CBDC projects.

Around the econOHMy

Around the econOHMy we have recently seen:

  • Off the back of a huge run-up — Frax let slip in their telegram that they are working on a frxETHbasepool which could change the LSD game again
https://t.me/fraxfinance/248694
  • FiatDAO — in the closing days of their transition to integrating with Barnbridge — have proposed to sell off their gOHM and D2D and acquire AURA to get ready to incentivize FIAT II liquidity
  • Jones DAO did an AMA with GMX about the upcoming release of jUSDC and jGLP — apparently with the white paper tomorrow
  • The alOHM proposal over on Alchemix passed — meeting quorum with 62% of the vote abstaining — not a strong endorsement…

Market forces — New target price moves lower cushion

With the uptick in ETH and the handy performance of Jones & FXS (among others), we saw a material uptick in the liquid backing price of OHM.

This sent the price from about $10.50 at the beginning of the year to, at the time of going to press, $10.95.

As the price of backing was elevated this triggered a tick-up in the target price and the lower cushion of the RBS system was manually reset higher to take this into account.

https://discord.com/channels/798328113087119371/805854637163806751/1064750091925200926

The lower cushion previously was sitting at ~$9.63 and now sits at $9.86.

https://app.olympusdao.finance/#/range

Stronk!

Tap-16 — Opyn Crab, getting snipped

We have been sitting on the Opyn proposal for a few weeks no doubt Ohmies considering the wide-ranging implications of taking a directional bet (by not taking a directional bet) on the price of ETH.

At the time of press, the no’s currently have it — snipping the proposal with 94% against the trial deployment.

OIP-127 OHM Lending Markets Pilot Program

Finally, we saw the OHM lending market pilot program sail through governance with 99.9% of the vote.

This allows the Treasury to deploy up to 200K in OHM to Euler and Silo for the purpose of lending it out.

This comes with risks of course — someone could borrow it & dump it — thereby shorting OHM. But, as we are so far under backing, that will take a brave degenerate to try.

Developing borrowing markets like this is part of becoming a mature asset & just one more stop on the way to becoming the decentralized reserve.

The initial deployments will be at 5%apy borrow rate so at least we’ll be making a few bucks.

Till next week Ohmies!

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OlympusDAO community run media — by Ohmies, for Ohmies

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